Friday, August 29, 2014

What is demand planning?

Supply chain processes in general span the areas of demand planning, order fulfillment, distribution, production and procurement.

Demand planning controlling has the task to control the quality of the forecast and the quality of the demand planning process itself.

It is the process that an organization takes to anticipate customer demand and ensure sufficient product is available – in the right place, at the right time, to the required level of service and at the lowest possible supply chain cost.

This process using the forecast as a foundation for their decisions (pre-production, purchasing, provision of additional capacity, etc) need a quality measure to understand the accuracy of the forecast and the dimension of possible deviations of the forecast from the actual demand.

As a result of demand planning, independent requirements are created, triggering further production, distribution and procurement planning.

Demand planning has the task to provide the production planning process with forecast to trigger production before the customer places the sales order.
What is demand planning?

Popular Posts